Experts criticize the performance of Budget 2022 as Buhari unveils his budget proposal for 2023.

Ibekimi Oriamaja Reports

Experts are pointing out holes in the performance of the 2022 budget as the two houses of the National Assembly prepare to receive the President’s proposed budget for the fiscal year 2023 next month.

Mrs. Zainab Ahmed, Minister of Finance, Budget, and National Planning, revealed that an aggregate expenditure of N19.76t is projected for the fiscal year 2023.

The budget deficit for the fiscal year 2023 could range between N11.30t and N12.4t, depending on the Federal Government’s decision on fuel subsidy payments.

However, experts have continued to criticize the 2022 budget’s performance. The imbalance of debt service to revenue is one of the main factors highlighted as being responsible for the 2022 budget’s poor performance.

According to BudgIT, a civic-tech organization that advocates for openness and accountability in Nigeria’s public finance administration, the debt service-to-revenue ratio reached worrying proportions in the first four months of 2022.

According to reports, the country’s current debt service, which was at N1.94t from January to April 2022, is more than 100% of the country’s revenue, which was N1.64t during the same time.

In 2022’s first quarter, Nigeria’s public debt rose to N41.6t from N39.56t recorded at the end of December 2021, putting enormous pressure on debt servicing. Budget performance reports as studied by The Guardian showed that gross oil and gas revenue for full year 2022 was projected at N9.37t but as at April 30, 2022, only N1.23t was realised out of the prorata projection of N3.12t, representing a mere 39 per cent performance.

The reports showed that oil revenue underperformed due to significant oil production shortfalls such as shut-ins resulting from pipeline vandalism and crude oil theft as well as high petrol subsidy cost due to higher landing costs of imported products.

Non-oil taxes also fell far below targets marginally, with average performance of 92.6 per cent. Experts say budget performance in the last one year has been nothing but sub-optimal.

Their position was revealed following an examination of two federal ministries, namely the Ministry of Industry, Trade, and Investments and its counterpart, the Ministry of Finance, Budget, and National Planning.

Prof. Sheriffdeen Tella, a Professor of Economics at Olabisi Onabaqnjo University, stated in his submission that the trade and industry sector had not performed better than other sectors, and that the oil subsector, which normally dominates trade, was unable to perform despite the opportunity, as Nigeria was unable to meet OPEC crude oil allocations. Tella claimed that the non-oil sector could not fill the void created by the world’s slow growth.